During the past three years, the Court Theatre has been an oasis away from the tough realities of a city recovering from disaster.

But any New Zealand theatre must face harsh realities of its own: competing for arts funding, a small population to draw punters from, and a post-recession ticket sales slump.

In a competitive arts environment in which some of the country's oldest theatres have recently gone under, the Court turns over a healthy $6 million a year, and provides up to 130 jobs in the city. So what's the formula for success?

Philip Aldridge is the theatre's chief executive, and responsible for making sure the theatre remains financially viable, as well as culturally rich.

Aldridge is an actor who trained and worked in the UK. After years in the theatre, he left for a career in corporate finance - a role he describes laughingly as "just another big acting job".

He is still chairman at BNZ Canterbury, but says the theatre is a fulltime occupation.

Today, preparing to be photographed, he unpins a bank name-badge, and settles himself in one of the theatre's red velvet seats. It's a small act that encompasses much of Aldridge's role here - bridging the worlds of high finance and theatre.

It's not always an obvious fit, Aldridge says, but it is essential.

His running of the court theatre is a constant balancing act: weighing the tried and true against the new and untested, and artistic integrity against business sense.

By its very nature, he says, the theatre is "a ridiculous business model: you find something that works, and you put that in the bin and start all over again doing something entirely different."

It's a tough model for survival, and not all make it through.

Downstage, the country's oldest professional theatre company, shut down last year after nearly 50 years in Wellington.

The theatre depended on Creative New Zealand funding for much of its income, and was forced to close when ticket sales fell and that funding was withdrawn.

The Court, which raises most of its own funding through ticket sales, sponsorship and contributors, strives to avoid some of this vulnerability.

Aldridge says the theatre has, over the years, "been run very judiciously, very financially competently, to facilitate the art".

It's a commitment which, he says, is not necessarily unusual, but "quite often goes wrong - it's a very risky business".

"It's a curious beast in that it is very successful, but it's also very precarious. You never know how the next play is going to be received. That's wonderfully exciting and artistically very challenging."

In this kind of environment, he says, attendance and loyalty are an enormous part of a theatre's financial survival.

It's a relationship that the Court has negotiated successfully so far.

International theatre consultant Roger Tomlinson said the Court's loyalty rankings were matched only by the Royal Opera House in Covent Garden.

Aldridge says the city's attendance statistics were "off the charts", with the theatre selling 160,000 tickets per year. That's almost one ticket for every two people in the city - compared to the Melbourne Theatre Company, which sells 220,000 tickets to a population of more than 4 million.

The Court's last two big summer shows - Grease, and this year's The Mikado, were almost sold out, and both had seasons extended. Playing six days a week for nine weeks, Grease sold out 99 per cent of the theatre's 388 seats. Ticket sales from that show alone would tip the $800,000 mark.

The Mikado followed closely, selling 93 per cent.

A solid lineup of popular shows, Aldridge says, provides a platform for the theatre to take on more experimental work. "That relationship with the audience is hugely important. If people trust us, they will come to see a play that they wouldn't go to see otherwise.

"Quite a bit of the work we do is new, which is unusual in such a successful company, because it's much greater risk. One of the reasons we can afford to do new work and take risks is doing those very popular shows."

The company remains committed to nurturing new New Zealand writing, and is the largest commissioner of new theatre in the country. It's a role Aldridge takes seriously, and as the largest theatre company in the country, he says, "it's a responsibility".

Aldridge is not the only one to see the arts as a vital part of the city.

After the Christchurch earthquakes, the Court was one of the first large public buildings to be rebuilt and functioning again. The theatre was up and running again within just four months, and funded almost entirely by locals. He notes - with some glee - that is was "theatre first, rugby stadium second".

"We think of ourselves as an earthy people and a pioneering people and a sporty people, but when describing the nation we wouldn't always put arts in there. But the first thing people paid for with their own money, that they said they wanted, was the theatre. Which is art and music and laughter and poetry. That's what people wanted."

As well as aiding the mental health of a recovering city, Aldridge is firm that there is an economic imperative to have a strong arts base in the city.

"It's absolutely vital. You wouldn't want to relocate a business or start a new business in a city that your employees wouldn't want to live in.

"So it's hugely important to the regrowth of the city that we show them a vibrant cultural centre."

The Court is a big employer, particularly in the arts community, for whom steady paid work is hard to come by. As well as the obvious actors, directors and musicians, the theatre has a permanent staff of five craftsmen, who create all the sets from scratch, and wardrobe staff who sew costumes for each show.

The soundproofed back walls of the theatre hide a rabbit-warren of offices for art directors, business managers, prop designers and advertising staff.

Arts voice Canterbury chairman Warren Feeney

believes the loyalty that sustains the Court Theatre will not disappear any time soon.

"The Court provided a really good example, very early on, of recovery. It's not about just the presence or the performance of the arts, it's actually the reassurance that the city is being normalised, that things will come back, and will be as they were."